Trust Services

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
2wendyliu
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Re: Trust Services

Post by 2wendyliu » Sun Oct 06, 2019 10:24 am

Ditto to NewMoneyMustBeSmart, we have also decided that "directed" corporate trustee is the way to go. And for that the state of South Dakota seems to have the most favorable laws/environment. Not only do directed trustees stay out of your important decisions, they usually charge fees based on duties performed instead of a percentage of the trust asset.

South Dakota Trust Company works with trust settlers and beneficiaries directly - https://www.sdtrustco.com/sdtc-philosophy

National Advisors Trust Company South Dakota Chapter partners with financial advisors - https://www.nationaladvisors.com/servic ... uth-dakota

robandjeanne
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Joined: Thu Mar 28, 2019 11:59 pm

Re: Trust Services

Post by robandjeanne » Sun Oct 13, 2019 2:31 am

When you decouple and go with your own RIA does your RIA insist on having bonds and international investments? Does your RIA have a goal of matching VTI, and if not does he estimate how far below VTI he will be.How do you handle the issue of your RIA predeceasing you? When i last checked with Schwab, they will do the admin portion for a very low fee, but only out of Delaware. Is anyone concerned with an ST like Schwab (or others in DE, SD, and NV) who insists on changing the situs to a different state? My lawyer seemed alarmed because the Trust was written in VA, but now the laws of another state he's unfamiliar with will apply.

robandjeanne
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Re: Trust Services

Post by robandjeanne » Wed Oct 16, 2019 8:39 pm

We found a Successor Trustee who will do index investing (VTI) with all our future portfolio investments. The only issue is they are in SD and we are in VA. I'm not sure if this is a concern, since our Trust says the situs can be moved. Of course since I've only met this potential ST on the phone and via emails, I have no real idea how bona fide they are. The firm is Wealth Advisors Trust Company in Rapid City, SD. Anyone know about them or know how to get an objective opinion on how good and honest they are? We had to go through at least a dozen STs to find one willing to do bogle style index investing, with almost all local outfits insisting on a lot of bonds and international investments, I wonder why SD based Successor Trustees seem willing to do what many of us want?

2wendyliu
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Re: Trust Services

Post by 2wendyliu » Thu Nov 07, 2019 1:13 pm

Since my trust attorney only deals with Nevada trusts and not South Dakota trusts, I had to take a closer look at the pros and cons of either. I found this article, though a few years old, to be helpful in summarizing the main points when it comes to dynasty trust offering asset protection - https://www.thewealthadvisor.com/articl ... ust-states

The following two paragraphs copied from a trust lawyer's blog point out two areas that favor Nevada over South Dakota:

The best protection is to set this structure up far in advance of any creditor problem. This is because each state has a statutory waiting period until the assets are protected. You also don’t want to get caught in the snare of a fraudulent transfer. A court could consider the transfer to a DAPT (Domestic Asset Protection Trust) fraudulent if you transferred property to the trust after the threat of a creditor action or lawsuit has arisen. Each state has its own statutory waiting period from the date the asset is transferred to the DAPT and when the asset is protected from a creditor’s claim. For example, Nevada’s statutory waiting period is two years.

Nearly all of the states that allow for DAPTs also have exception creditor statutes. These statutes protect certain classes of creditors by allowing them access to a DAPT’s assets. One common exception creditor is a divorcing spouse. There is one state that doesn’t have exception creditors and that is Nevada.

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FIREchief
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Re: Trust Services

Post by FIREchief » Thu Nov 07, 2019 3:42 pm

robandjeanne wrote:
Wed Oct 16, 2019 8:39 pm
We found a Successor Trustee who will do index investing (VTI) with all our future portfolio investments.
Did they put this in writing?
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

robandjeanne
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Joined: Thu Mar 28, 2019 11:59 pm

Re: Trust Services

Post by robandjeanne » Mon Jan 06, 2020 4:16 pm

Did they (Successor Trustee) put in writing they would follow a VTI future investment directive? No, but two of the principals in the Trust Co agreed to it, and perhaps most importantly the chief Trust investment officer (a fan of Vanguard) agreed to it. Also I have a detailed Successor Trustee Directives document that our lawyer wanted to put after the signature page (ie outside the body of the Trust). Knowing how difficult it is to get STs to agree to a VTI investment directive, I insisted (with great push back from our lawyer) to put this directive in the body of the Trust. We have a final meeting with our lawyer coming up, so I hope he does what I suggested. Should I do more? I believe I emailed the Trust officer thanking him for agreeing to manage a VTI directed Trust for $70K/year( I should review that email). The second candidate ST is in SD, and once he saw the VTI directives said that made it easy for him, he would simply invest that way. That's what I naively expected of all STs, but locally in VA I had to go through more than a dozen to find one. I have yet to figure out why the local STs thought they were superior and doing us a favor at $70K/year, and furthermore had the right and obligation to invest their way.

MikeG62
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Location: New Jersey

Re: Trust Services

Post by MikeG62 » Mon Jan 06, 2020 10:07 pm

robandjeanne wrote:
Mon Jan 06, 2020 4:16 pm
Did they (Successor Trustee) put in writing they would follow a VTI future investment directive? No, but two of the principals in the Trust Co agreed to it, and perhaps most importantly the chief Trust investment officer (a fan of Vanguard) agreed to it. Also I have a detailed Successor Trustee Directives document that our lawyer wanted to put after the signature page (ie outside the body of the Trust). Knowing how difficult it is to get STs to agree to a VTI investment directive, I insisted (with great push back from our lawyer) to put this directive in the body of the Trust. We have a final meeting with our lawyer coming up, so I hope he does what I suggested. Should I do more? I believe I emailed the Trust officer thanking him for agreeing to manage a VTI directed Trust for $70K/year( I should review that email). The second candidate ST is in SD, and once he saw the VTI directives said that made it easy for him, he would simply invest that way. That's what I naively expected of all STs, but locally in VA I had to go through more than a dozen to find one. I have yet to figure out why the local STs thought they were superior and doing us a favor at $70K/year, and furthermore had the right and obligation to invest their way.
I don’t know that you should or can do more.

Just keep in mind that despite the considerable effort you are putting forth and diligence you are doing, the key people you are getting verbal representations from may be gone, retired or dead themselves by the time your assets make their way into the trust. Who knows what the future successors of these folks will be ok with at that time.

For this reason, I have found this issue to be a very difficult thing to fully run to ground myself. The landscape just seems to keep changing.
Real Knowledge Comes Only From Experience

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FIREchief
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Re: Trust Services

Post by FIREchief » Mon Jan 06, 2020 10:14 pm

I think it is quite simple. The only thing that can override prudent investor rules (and the profit-hungry independent trustees who hide behind them) is the trust document itself. If the trust document says "invest in VTI to the maximum extent possible," then the only challenge is finding an independent trustee who is willing to take $70K a year for 30 minutes of work. You would think that would be easy, wouldn't you?? :confused

(a bit of hyperbole to make a point, the trustee does other things and there are more flexible ways to require low cost investing that simply 100% VTI - see my signature)
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

robandjeanne
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Joined: Thu Mar 28, 2019 11:59 pm

Re: Trust Services

Post by robandjeanne » Mon Feb 17, 2020 4:17 pm

Does anyone use a "lawyer's letter" or "lawyers flash drive" to convey critical information for Successor Trustees or maybe beneficiaries after their passing? We are coming to the end of nearly a year effort to create a Revocable Living Trust (RLT) which is like a dynasty trust and may go on a long time. The bulk of our assets are in a portfolio of investments which could be managed easily by a Successor Trustee if they had the encrypted passwords to each investment. These passwords and other important details are on encrypted files on several flash drives. The complete Trust (RLT) can also be added to these flash drives. Presently all this critical information is in a safety deposit box, and the bank seems to be getting finicky about authorized out of state representatives (with no bank accounts) having access. If we had a guaranteed way to pass this information on, we probably wouldn't need a safety deposit box, or it could become a secondary or back up source.

Murgatroyd
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Re: Trust Services

Post by Murgatroyd » Mon Feb 17, 2020 4:46 pm

Fidsafe.com is the easy solution. You can designate documents as viewable currently or only after passing. The heir need only present fidsafe with death certificates to unlock post passing access.

We have our daughter as successor trustee. Right now she can access POA and health directives as well as other personal information such as important contacts. After passing includes everything else including items you mentioned. In our case it’s great because she travels the world in the Navy and none of us worry about where to find things.

robandjeanne
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Joined: Thu Mar 28, 2019 11:59 pm

Re: Trust Services

Post by robandjeanne » Mon Feb 24, 2020 2:25 am

Fidsafe.com sounds like a great idea, thanks.

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